Promoting foreigners to arbitrate in Thailand
Initially, a foreigner who wishes to perform the duties of an arbitrator and an attorney of the parties for the arbitration proceedings in Thailand must apply for a work permit, according to Section 59 of Foreigners’ Working Management Emergency Decree, B.E. 2560. Also, subject to the List of Prohibited Occupations for Foreigners, attachment of the Royal Decree Establishing Occupations and Professions That Prohibit Foreigners from Doing, B.E. 2522. When considering the attachment, an arbitrator and an advocate in an arbitration proceeding are exempted. (1)
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However, these exemptions have a different condition as an arbitrator is not listed as a prohibited occupation in Thailand, whether or not the case is governed by Thai law or will there be award enforcement in Thailand. Meanwhile, a foreigner who acts as an advocate in the arbitration process can only be working if that case’s governing law is not Thai or no award enforcement in Thailand.
After that, the Ministry of Justice has launched policies and strategies to promote Thailand as a regional hub for Alternative Dispute Resolution. Particularly in arbitration. The government then enacted related laws and also amended the existing laws and regulations to achieve the goal to promote arbitration in Thailand to foreigners(2).
Legal measure at present
In 2019, the arbitration changed mainly in 2 areas;
Board of Investment Promotion (BOI) has announced to include arbitration as one of the focus industries that can be applied for SMART VISA. This measure has significant as the scope of a highly-skilled expert is not only an arbitrator but also includes related supporting roles that required specialized skills or skills are in shortage in Thailand, such as legal consultant in arbitration, transcriber, secretary of an arbitral tribunal, etc.
This type of visa has additional privileges than a general visa, including an exemption of work permit, extension of the reporting period, no re-entry permit requirement, fast track lane, and the right to stay and work for spouse and legitimate children of the visa holder.
With these privileges, this visa is suitable for highly skilled experts to work for an extended period or to establish a permanent office to provide arbitration services in Thailand. This visa also ideal for those who have at least 30 working days to proceed with the document, counting from the date submitting an application to BOI. The visa applicant must be permitted to apply for Smart Visa to work in Thailand legally.
To apply for a certificate to perform under the Arbitration Act (No. 2) B.E. 2562. The Act added a chapter about foreign arbitrators and representatives specifically. This measure is to apply for certification to work under Section 60 of the Emergency Decree on Management of Foreigners’ Working B.E. 2560. This measure excludes the official’s discretion to issue the certificate by obligating that the Department of Employment must issue a work permit if the application meets all conditions in the certificate (both in duration and condition of performance). While waiting for the issuing process of the work permit, the applicant may work temporarily.
In addition, this case is not on the list of prohibited occupations. Even the representatives to defend in the arbitration case that uses Thai as a governing law can perform their duty following the certificate in this measure. As the scope of work is limited to the performance of an arbitrator or authorized person, this measure has a limited scope than Smart Visa and do not have the same privileges, subject to the visa conditions for staying and working and type of visa that is granted.
Aside from these two measures, there are some legal movements this year related to the performance of those who involve in arbitration proceedings in Thailand. Department of Employment has announced the Notification of Ministry of Labor RE: Schedule of Work Prohibited By Aliens (3), effective as of previous mid-June (4). The Notification is enacted by virtue of Section 7 of the Emergency Decree on Management of Foreigners’ Working B.E. 2560 and supersede The Work Prohibited list prescribed by the Royal Decree issued under Section 6 of the Foreigners’ Working Act, B.E. 2521 (5).
What is the impact of this Notification?
In theory, legal services are listed in Table 1, which is strictly prohibited for a foreigner. The exception is only the foreigner arbitrator, including assisting or acting on behalf of the arbitration proceedings when the applicable law is not Thai. The amendment in this Notification makes it more apparent. It was initially defined only the defending in the arbitration class, which caused confusion and exact undetermined scope.
It also excludes the condition of not applying for award enforcement in Thailand, extending the work scope compared to the list of prohibited work that had been previously used. However, other details still remain the same; there is a definite duration for the work permit of not more than 2 years per time. Receiving a work permit, in this case, can be used to work for something else that is not prohibited by the Ministry of Labor’s new Notification automatically.
When considering the work scope to apply for the permit, this work permit has a broader range than the two previous measures. Nevertheless, this permit has its disadvantage as the processing duration and document requirement are more complicated than the work permit applications under the Arbitration Act (No. 2 ) B.E.2562. Moreover, while waiting for the issuance of the work permit from the Department of Employment, the applicant could not work in the Kingdom. Otherwise, he will be risking the criminal penalty or being listed as a prohibited person to apply for a work permit in Thailand.
Measures related to THAC
From the abovementioned, these are new measures for both officers and operational personnel. To utilize the best efficiency and minimize practical problems, THAC has been trying to collaborate with related organizations like the Department of Employment, an authorized body for foreigners’ work permits, to reduce the number of required documents and processing time than general work permit (6).
THAC also collaborated with the Department of Consular Affairs, Ministry of Foreign Affairs, an authorized body to allow foreigners to enter Thailand, to discuss visa processing problems. As courtesies from these two departments, THAC is permitted to publicize and forward related documents to all operational personnel to understand these measures in this regard. The collaboration is based on the common goal of promoting arbitration in Thailand, reducing its obstacles, and eventually attracting foreigners to submit to arbitration in Thailand.
Legal measures related to promoting arbitration in Thailand for a foreigner are;
1. SMART Visa
When considering visa applicants’ eligibility, it is evident that this type of visa has a broader scope compared to work permit applicants. This covers highly-skilled expertise in arbitration proceedings, including arbitrator, authorized person, consultant, and supporting roles. A person who is granted this type of visa will have privileges over those granted with a general visa. There are some concerns for this measure as it takes a longer time to process in comparison to other measures and therefore is not suitable for those who wish to enter the Kingdom urgently. Besides, while waiting for Smart Visa’s approval, the applicant could not engage in any arbitration proceedings.
2. The application for a practicing certificate according to the Arbitration Act (No. 2 ) B.E. 2562
This measure has the advantage of taking less time to process than a general work permit. During the approval process for the permit to work, the applicant can temporarily work by using a certificate issued by an organization or institution that provides arbitration services. Also, the required documents are significantly less than a general work permit. This measure’s disadvantage is that the foreigner can only work in specified jobs or tasks in the certificate.
3. A general work permit.
This permit has its advantage as the visa holder can work in other jobs, except in the prohibited list. Moreover, the enacted Notification from the Ministry of Labor has also extended the scope of related arbitration proceedings in a broader definition, including supporting and assistance roles. However, there are no privileges like the measure in (1), and it requires more documents and processing time than the measure in (2).
It is evident that all legal measures aim for the same goal: to encourage foreigners to choose Thailand as a venue for an arbitration proceeding. Each measure is required differently: a purpose to stay or work in Thailand, the urgency to entry, and duration to prepare documentation. In each measure, there are details and its pros and cons to be considered differently.
Another issue to be considered is that before submitting the new permit, one must first check the selected category of the previous permit and submit the new permit in the same category. For example, if the foreigner is already granted with work permit and wishes to perform as an arbitrator or assist or represent a disputant (if not using Thai law), such foreigner can proceed promptly without having to submit a permit to work under the Arbitration Act as to avoid the redundancy of the document.
- (1) Details in the Royal Decree prescribing work on occupations and professions that prohibit aliens from doing (No. 3) B.E. 2543, Government Gazette Volume 117, Section 105 Kor, dated November 15, 2000.
- (2) the 20-Years-Strategy of the Ministry of Justice (B.E. 2560-2579), retrieved from http://waa.inter.nstda.or.th/stks/pub/2018/20180130-MinistryofJustice.pdf.
- (3) Details in the Notification of Ministry of Labor. Re: Schedule of work prohibited by aliens, Government Gazette Volume 137, Special Section 92 D, dated April 21, 2000.
- (4) this Notification will come into force after sixty days from the date of publication in the Government Gazette (Article 1 of the Notification).
- (5) Section 134 of the Emergency Decree on Management of Foreigners’ Working B.E. 2560.
- (6) details as per the Letter of The Department of Employment, most urgent, Ror Ngor 0303/60685 dated May 21 2562 RE: the setting of guidelines for issuing work permits and related documents for foreigners to perform their duties in an arbitration proceeding in according to the Arbitration Act (No. 2) B.E. 2562.